U.S. Lists Possible Targets of Trade Sanctions

Warning that “time is running short,” U.S. Trade Representative Carla Anderson Hills on Tuesday named $2 billion in European spirits, cheeses and other goods as possible targets of U.S. retaliation because of European farm subsidies.

It was the latest U.S. step to try to force the 12-nation European Community to alter its program of subsidies. Two world trade panels have ruled that EC subsidies to oil seed producers violate a 1962 trade agreement.

The EC unsuccessfully modified its program last year in hopes of satisfying U.S. objections to the subsidies.

The dispute could affect the already delayed attempt to write a new global trade pact, trade experts say.

The oil seed dispute began five years ago when the American Soybean Assn., which represents U.S. soybean farmers, filed a trade complaint.

Washington contends that $1 billion in potential U.S. exports are lost each year because of the trade-distorting EC oil seed subsidies.

Oil seeds are crops such as soybeans, peanuts, rapeseed and sunflowers.

U.S. and EC officials met recently in Washington to discuss the dispute but made no breakthroughs.

“We would much prefer a negotiated resolution to this matter,” Hills said Tuesday at the same time she unveiled the list. “The door is still open to EC proposals that would improve market access for U.S. soybean exporters, but time is running short.”

The list is scheduled for formal release Friday. After a 30-day period for public comment, it will be narrowed to $1 billion of products that would be subject to prohibitive duties.

Among the items on the nine-page list of possible targets were some cut flowers, more than a dozen cheeses, fresh peppers, dried tomatoes, pork sausages, smoked oysters, preserved artichokes, pimentos and sweet biscuits.

Among beverages were chocolate milk, apple juice, sparkling wine and certain types of vermouth, vodka, brandy and bitters.

Also on the list were mushrooms, milk protein concentrates, industrial rapeseed oil, leaf tobacco and some types of cat and dog food.

The list did not specify the volume of sales for each item. It was released late Tuesday, and neither the EC nor U.S. farm groups were available to comment.

At the end of last week, the EC offered to negotiate under rules of the world trade body, the General Agreement on Tariffs and Trade, which allows compensation to be paid to nations damaged by another nation’s practices.

On Monday, U.S. Agriculture Secretary Edward R. Madigan said the EC offer of possible compensation would not deter the United States from pursuing retaliation.

“I don’t believe that any offer . . . will keep us from publishing a retaliation list,” he said. “We’re not looking for compensation as much as we are for (export) opportunities.”